Outlook 2025

The year 2024 ends with significant economic disparities between regions. Which asset classes should be favoured for 2025?

Global growth progresses in line with expectations, but the economic landscape remains fragmented. While activity is strong in the United States, the Eurozone is struggling to move forward, and China is penalised by weak consumption. Geopolitical tensions and the rise of political uncertainty in several countries risk exacerbating these divergences in 2025.

As we head into 2025, the stars seem to be aligning for a revival of mergers and acquisitions, creating a fertile environment for investors seeking new opportunities. Merger arbitrage strategies attempt to capitalize on M&A activity by using a structured approach returns.

2024 concluded as another annus horribilis for climate action, with COP29 blowing “hot air”, reinforced geopolitical tensions overshadowing the climate crisis, and the re-election of Donald Trump in the U.S. We only have a couple of years left before spending the totality of the +1.5°C carbon budget. How will the recent political changes and global geopolitical tensions impact the transition?

With Donald Trump returning to the White House in 2025, his second term is likely to see a resurgence of tariffs and export restrictions among other things, raising concerns about China's ability to withstand a resurgence of 'America First' policies.

As Donald Trump returns to White House, his policy agenda could send ripples through the global oil market. His trade wars and immigration stance are expected to fuel inflation, while his commitment to deregulation and to increasing US oil production pose new challenges for oil prices.

If investors are expected to be early in detecting future trends, then our community certainly thinks AI is the future. Will the surprises continue? To help train ChatGPT’s response, we analyse the tangible revenue that has emerged so far, and consider the ‘sweet spot’, the ‘runners-up’ and the ‘too early’.

Conflicting or competing regulatory regimes on both sides of the Atlantic, a changing rates environment with central banks in easing mode, and consolidation are the new trends to watch in the European banking sector as we head into 2025. Select carefully and keep an eye on the emissions.

While easing interest rate pressure may bring some relief to the European property market, some challenges remain, making selectivity crucial in navigating today's uncertain environment.

Between 2005 and 2017, when most Eurozone economies saw declines in both the weight of their industries and their export market shares, Germany stood out for its powerful industry, strong market shares... and its fiscal rigor. Over this period, German GDP grew 10% faster than the rest of the zone. Germany and its social co-management model (Mitbestimmung) have long been held up as the example.

As disinflation gains momentum and the Federal Reserve (Fed) begins to ease monetary policy, the election of Donald Trump risks altering the trajectory of the US economy. While uncertainties remain about the policies he will ultimately implement -- and their timing -- the general direction of his proposals seems clear: They are likely to widen the interest rate spread between the US and Europe and strengthen the dollar.

As the year 2024 draws to a close, it has recorded levels for stock market indices, buoyed by the strength of certain sectors such as technology, a solid economic recovery, and moderating consumer prices. Continued disinflation has led to the beginnings of monetary easing, offering a breath of fresh air to financial markets.

Throughout the month of December, we invite you to join us in analysing the main issues and perspectives on ten key questions that will impact investing in 2025: European and transatlantic monetary policies, the breakdown of the German economic model, the slowdown in European real estate, artificial intelligence, the banking sector... there will be no lack of challenges and opportunities, it's up to us to seize them together!